City workers' retirement plan: what it costs and how well it is funded

City workers’ retirement plan (DRAFT – not published)

In short

City workers get a pension from a statewide plan for Texas cities.¹ Workers put in 7% of their pay. The city puts in 12%.¹ At the end of 2024, the plan had about 89 cents for each dollar it expects to pay city retirees.² The gap was about $9 million.¹

How it works

• The plan: The city is part of the Texas Municipal Retirement System. The city picks its options within state rules.¹
• Who pays in: Workers pay 7% of their pay. The city matches $2 for every $1 a worker saves, paid over time. The city’s rate was 12% of pay in 2024 and 2025.¹
• When workers can retire: after 5 years they keep the city’s share. They can retire at 60, or at any age after 20 years.¹

The numbers

	Amount
What the plan expects to owe city retirees (end of 2024)	$85.3 million
What the plan had saved for them	$76.3 million
Gap (what is not yet saved)	$9.0 million
Share saved	89.5%
City payment, year ending Sept. 30, 2025	$4.7 million

Source: city annual financial report, pension note and tables.¹²

The share saved was 81% at the end of 2022 and 89.5% at the end of 2024.²

The other side

• The gap depends on guesses. The plan guesses it will earn 6.75% a year. If it earned 1 point less, the gap would be about $23.4 million. If it earned 1 point more, there would be no gap.¹
• The city paid what was asked. The city has paid the full required amount in each of the last ten years.²
• The plan is growing fast. The city has more workers each year, so what it owes grows too. It rose from $51.3 million at the end of 2020 to $85.3 million at the end of 2024.²
• For comparison: Williamson County’s plan for its workers was also about 89% funded at the end of 2024.

How nearby cities compare

These cities use the same statewide plan. Each number is the share saved at the end of 2024, from each city’s own audit for the year ending Sept. 30, 2025.

City	Share saved, end of 2024
Leander	89.5%
Georgetown	88.7%
Round Rock	86.9%
Cedar Park	81.0%

Sources: city audits.³²

• Leander is highest of these four, but only just. Each city picks its own benefits and pays its own rate, so the numbers do not show which city is better run.
• All four are measured on the same date, so the markets were the same for each.

Questions to ask

• What will the city pay into the retirement plan this year, by its budget?
• Where does the city post the plan’s yearly report?

What you can do

• Ask the city how the yearly pension payment fits in the budget.
• Look for the pension tables near the back of the city’s annual financial report.

Changes to this page

• Nov. 2, 2026: Added questions to ask.

What we still don’t know

• What the city’s payment will be for 2026-27. The adopted budget does not list it on its own line in the parts we read.

Footnotes

1. City of Leander, FY2025 Annual Financial Report, notes on the Texas Municipal Retirement System (plan terms, 7% employee rate, 12.00% city rates for 2024 and 2025, $4,673,216 paid, net pension liability $8,952,302, 6.75% discount rate and sensitivity table). https://emma.msrb.org/P11938164.pdf ↩ ↩² ↩³ ↩⁴ ↩⁵ ↩⁶ ↩⁷ ↩⁸

2. Same report, Required Supplementary Information, schedule of changes in the net pension liability (2020–2024) and schedule of contributions. https://emma.msrb.org/P11938164.pdf ↩ ↩² ↩³ ↩⁴ ↩⁵ ↩⁶

3. FY2025 audited reports (year ended Sept. 30, 2025), Texas Municipal Retirement System schedule of changes in net pension liability, measurement year 2024, plan net position as a percentage of total pension liability. Georgetown 88.70%: https://emma.msrb.org/P11940492-P11476103-.pdf Round Rock 86.91% (p. 100): https://www.roundrocktexas.gov/wp-content/uploads/2026/02/FY25-CORR-Audit-Report.pdf Cedar Park 80.99%: https://emma.msrb.org/P11938602.pdf ↩